Fed: Costello warns PBS at peril if costs not contained

AAP General News (Australia)
04-26-2006
Fed: Costello warns PBS at peril if costs not contained

CANBERRA, April 26 AAP - Australia's system of subsidised medicines could disappear
in coming decades if the government does not keep trying to tackle rising health costs,
Treasurer Peter Costello says.

Mr Costello today told reporters the government needed to remain vigilant with the
Pharmaceutical Benefits Scheme (PBS).

"We do have to be very vigilant in relation to pharmaceutical costs," the treasurer said.

"As I've said, if we're not vigilant, over 20 or 30 years the system we currently operate,
which is a good system, could well break."

The consumer price index, the key measure of inflation, was up 0.9 per cent in the
March quarter, with large increases in the price of medicines a major factor.

"New pharmaceuticals are being invented all the time and they're much more expensive,"

Mr Costello said.

"They can treat conditions we couldn't treat in the past."

The ageing population is also contributing to the increased use of pharmaceuticals.

"The older you get the more you draw down on pharmaceuticals," he said.

Mr Costello said the government still had control over the expanding cost of the PBS
and the Medicare safety net.

"We have announced a lifting of the safety net in last year's budget and we announced
an increase in the (PBS) co-payment some years ago," he said.

"Preliminary evidence shows that this is actually working. We're not stopping the rate
of increase, we are restraining the rate of increase but it's still growing far faster
than the economy is growing."

Mr Costello predicted there would be significant changes in the operation of the PBS
over the next 20 or 30 years.

"I would be very, very surprised if the system that operates in relation to the PBS
today is the system that's operating in Australia in 20 years time," he said.

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KEYWORD: PBS COSTELLO

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